A big, controversial Columbia River oil terminal: The governor will decide

The nearest deep-water port to North Dakota’s Bakken oil field is Vancouver, Washington, and as many as four tanker trains, each a mile and a half long, will arrive at the Columbia River each day if the Vancouver Energy Distribution Terminal is built.

“This is an ideal area for a project like this,” said Jared Larrabee of Savage, the oil and gas services company which with Tesoro would run the terminal in a joint venture.

The terminal would handle as many as 360,000 barrels of oil a day, taking it off trains and putting it on U.S.-flag ships bound for West Coast refineries.

But the project, hosted by the Port of Vancouver, faces major resistance. And Puget Sound cities have seen anti-oil-train protests.

“The City of Vancouver strongly requests that the Governor of Washington . . . and any other relevant state agencies decline to permit crude-by-rail oil terminal projects, and specifically the proposed Tesoro-Savage project,” the Vancouver City Council said in a strongly worded resolution passed last month.

The terminal builders have moved to address worries about safety, at least where the oil will be unloaded and reloaded.

The Tesoro refinery in Anacortes received its first oil-by-rail shipment in September 2012. Tesoro touts that it has replaced its entire fleet of 1960s-vintage DOT-111 rail cars, of a kind that blew up a year ago in Lac Megantic, Quebec.

A DOT-111 rail tanker used to ship crude oil from North Dakota’s Bakken region. The cars were involved in derailments of oil trains in Casselton, N.D., and Lac-Megantic, Quebec. Tesoro says it has phased out the DOT-111 and will not permit it at proposed Vancouver terminal.

Newer, safer cars “are the only cars we will accept at the terminal,” said Jennifer Minx, senior communications manager with Tesoro. Tesoro has committed to the first 60,000 barrels of capacity at the proposed terminal, but anticipates other oil companies will use the facility.

Tanker cars will undergo “a very formal inspection” when they enter the oil terminal and “be inspected again before leaving the facility,” said Larrabee, who will manage the terminal. “We’re the ones who designate that the cars are sealed and can be moved out.”

But oil trains are operated by railroads, and the railroad industry is renowned for guarding its prerogatives, resisting regulation and giving out as little information as possible.

In a report early this year, quoted by the Washington State Council of Firefighters in urging delay of the Vancouver project, the National Transportation Safety Board said:

“Because there is no mandate for railroads to develop comprehensive plans or ensure the availability of necessary response resources, carriers have effectively placed the burden of remediating the environmental consequences of an accident on local communities along the route.”

Although Tesoro-Savage hoped to begin operation in 2014, the Vancouver project — if approved — is not likely to begin construction until next year.

The Tesoro refinery in Anacortes, photographed on April 2, 2010, the morning after a heat exchanger explosion and fire killed seven workers. Investigations blamed a lax safety culture at the plant.

The terminal proposal is due to undergo a thorough environmental review by the state Energy Facility Siting Evaluation Council. The final decision on the project is likely to rest with Washington’s “green” Governor Jay Inslee.

Tesoro and Savage have experienced no problems with unloading oil from trains in Anacortes. But the refinery was the scene of a major disaster in 2010. The rupture of a heat exchanger caused an explosion and fire that killed seven workers. A state investigation cited Tesoro for 39 “willful” and five “serious” violations of regulations.

The U.S. Chemical Safety Board, in a report released early this year, decried a safety culture that produced a “complacent” mindset toward flammable leaks and fires. It blamed the explosion on “a deficient refinery safety culture.”

Earlier, state Department of Labor and Industries Director Judy Schurke found that “the deaths of these men and women would never have occurred had Tesoro tested their equipment in a manner consistent with standard industry practices, their own policies and state regulations.”

A new report by the Sightline Institute, a critic of oil by rail, declares:

“A thorough review of Tesoro’s track record suggests that the community has every reason to be concerned. The company has a demonstrated track record of flouting safety rules, injuring workers, polluting local air and meddling in politics.”

“What happened in Anacortes was tragic and is not far from our minds — ever,” she said. The company investigated, made changes and shared information with other refiners. “Safety culture at Tesoro is very, very important,” Minx said.

“A refinery is very different from a terminal,” added Larrabee. He described Savage’s safety culture as beginning with hiring, extending to training of safety specialists, and including a national call every week during which “we share what we learn.”

The oil industry is dreaming big dreams for the Northwest as it seeks processing plants and markets for oil deposits in the interior of North America.

Washington’s refineries are moving rapidly to expand domestic oil shipped by rail and reduce imports arriving by water. Two big pipeline terminuses and export terminals, proposed for the west coast of British Columbia, would export Alberta tar-sands oil to Asia.

No export is currently planned for the Vancouver, Washington, terminal. “We have plenty of need for that crude at our own refineries on the West Coast,” Minx said.

Vancouver may be ideal as a terminal and shipping port for Tesoro and Savage.

Washington must now determine whether its interests are served by oil trains crossing the state and a massive new industrial project on the Northwest’s signature river.